Executive Bonus Life Insurance: A Tool to Win the War for Talent
September is Life Insurance Awareness Month and this timely article serves as a reminder to organizations of the importance of offering executive bonus life insurance. If your organization is looking for ways to attract & retain top executives, consider providing this incentive to key individuals as part of their overall executive compensation strategy. This type of benefit will offer your executives additional life insurance protection and policy cash values.
Both the employee and employer can benefit from executive bonus life insurance and partnering with M3 Financial makes implementing this arrangement an ease. Reach out to Chris Henderson to discuss how executive bonus life insurance may be a good option for your organization.
How can this benefit executives working for your organization?
Offering executive bonus arrangements with additional life insurance protection can be a key tool to attract and retain executives. This is because executives typically have a higher income and need larger death benefit protection than what is offered in a typical employer-sponsored plan. Through offering additional life insurance benefits, this creates an increased level of protection that may better suit their needs.
These policies are individually owned and portable and the executive has access to the cash value at retirement that serves as an additional source of retirement income.
How can this benefit the employer?
Employers have the power to select key employees who qualify for executive bonus life insurance, unlike a 401k plan where all employees must be included. This allows employers to offer individual bonus arrangements designed to accomplish specific goals. Employers will appreciate the minimal administrative costs and reporting that comes along with executive bonus life insurance. By providing key employees with additional life insurance, the plan costs are considered compensation and therefore deductible.
This is the ideal way to offer something of future value that executives will have to, and want to, maintain employment to get – thus reducing turnover. Employers can place a restrictive endorsement on such policies to serve as an incentive in encouraging their key employee to stay with the organization, and can be specific to that individual’s needs.
Executive bonus life insurance provides key employees with additional life insurance protection and can be leveraged as a negotiation tool to attract and retain top talent. This is an excellent benefit for executives and is easy for businesses to put into place when partnering with M3 Financial.
If your organization is interested in learning more about executive bonus life insurance options and how it could fit into your organization, reach out to Chris Henderson, managing director of M3 Financial.